Petrobras Faces New Calls to Cut Jet Fuel Prices

(Bloomberg) -- Brazilian government officials are pushing Petroleo Brasileiro SA to slash jet-fuel prices as part of an intensifying campaign to make the state-owned oil company help control inflation.

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Silvio Costa Filho, minister of ports and airports, and tourism minister Celso Sabino are blaming high jet-fuel costs for the roughly 24% jump in airline ticket prices last month in Brazil. Petrobras, they said, should do more to bring them down.

“We are working to combat abusive air ticket prices,” said Costa Filho, in a phone interview on Tuesday. “Aviation kerosene accounts for about 40% of the cost of flight in Brazil, while in the world, it’s about 20%.”

The two ministers join a chorus of officials trying to browbeat Petrobras into aligning its efforts with President Luiz Inacio Lula da Silva’s push to fight inflation and boost Brazil’s economy. The company, however, has resisted a wholesale shift in strategy, leading to growing dissatisfaction within the government of Chief Executive Officer Jean Paul Prates, according to people familiar with the situation.

Prates met Tuesday afternoon with Lula and several administration officials, including Brazil’s finance minister, the minister of mines and energy and the president’s chief of staff.

Afterward, the CEO said the focus of the meeting was the five-year investment plan that Petrobras intends to unveil Thursday. The officials, he said, didn’t ask him to lower fuel prices.

“There is no such request,” the CEO told journalists.

Read More: Petrobras CEO Under Fire as Brazil Seeks to Tame Inflation

--With assistance from Andrew Rosati.

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